Qantas delivers highest profit in history (Finance)

Qantas’ 2018 Yearly Report is in and the results are fantastic. Qantas has
posted a whopping $1.6 billion profit its highest ever.

Qantas will finally now have to start paying Company Tax after using up the
last of its tax losses from previous years.

Qantas profit was turbocharged by its record domestic result and cost savings
of $463 million as part of its Transformation Program.

Qantas Ratios (see Table below) show that Qantas strategic plan has been very
effective. Alan Joyce has steered Qantas from a huge loss in 2014 to now 4
consecutive years of stellar profits. Qantas is a much more profitable, resilient
and efficient business. In fact, it is in as good a financial condition as any airline
in the world.

The record result came despite higher oil prices. The airline expects fuel prices
to further rise by $690 million to $3.9 billion in 2019. Qantas is confident it can
offset this through a range of cost-cutting measures and its very successful fuel
hedging program.

Qantas is not sitting still and is aiming for further cost savings of $400 million a
year for the next 2 years led by its fleet renewal program.

Shareholders were stoked with the result with Qantas announcing its first
franked dividend since 2009. Despite the increasing returns to shareholders
(10 cents per share) and another $3 million share buyback Qantas is still able
to invest quite heavily in a continual upgrade of its fleet and lounges.

Qantas also announced that it would again pay bonuses of $2500 to workers
however this time there is a catch. Workers must sign new wage deals to
receive it. Watch this space for the reaction from its staff and unions. Qantas
has had a much more amicable relationship with both of late, but word out is
that they are not so happy about this development.

Source: Booming Qantas is finally about to pay some company tax by James Fernyhough The News
Daily 23/8/18, Qantas dividend move shows just how high Qantas is flying by Stephen
Bartholomeusz SMH 23/8/18, Qantas on the rise but higher fuel costs loom by Steve Creedy West
Australian 24//8/18,

David Broadbridge

David Broadbridge holds a Bachelor of Commerce at the UNSW and a Dip Ed at UNE. He is the former Head Business Studies teacher at Pymble Ladies College. Follow David on Twitter or read his Qantas News Blog.